Kellie Rastegar is Co-Founder and Creative Director at Rastegar Property Group.
Over the course of the pandemic, real estate investors have faced many challenges, with some asset classes soaring and others left struggling. In multifamily, the pandemic has created new demands from renters and new priorities for investors and developers with the rise of remote work. While there’s no doubt the traditional office will live on, it’s safe to say that many employers will continue with a hybrid approach to work, meaning workers will continue to stay remote post-pandemic, leading tenants to expect and require more out of their living space.
Across the U.S., as companies create plans for the future of their workforce, we can expect many to take on a hybrid schedule, if not a continued permanent remote work arrangement. This ongoing presence of remote workers means that changes are coming to traditional living spaces, especially in the rental market.
For investors, it’s vital to keep these changing sentiments in mind, particularly as many renters will likely rule out properties they feel cannot meet their remote work needs. In high rent areas like New York, there has been a staggering drop in rent prices. Investors in those large metro areas especially must adapt to meet these changing needs or renters will look to greener pastures with so many options vacant on the market.
Many younger employees have already taken advantage of remote work over the past year and moved out of those high-rent, densely populated cities, and it’s likely that we’ll see even more people hopping on this migration trend. As the workforce in America adjusts to the new normal of working from home, investors can expect they’ll be looking for living spaces that include elements of the office.
In the past, it was all about the traditional apartment amenities for renters, like access to a gym or a swimming pool. Now, renters have shifted priorities and are looking for spaces that cater to their new work-from-home lifestyle. Renters want specialized work-from-home features that will ease their ability to work remotely. To accommodate this, rather than the traditional amenities, landlords should make features like high-speed WiFi a staple amenity offering in multifamily buildings.
More dramatic changes in building layouts will likely be concentrated in larger metros, but even those in smaller towns across the U.S. will want dedicated spaces for working from home. With properties located outside of large cities, there may be more flexibility in updating existing layouts to be more accommodating to remote workers. Investors in smaller metros should love to make these updates for remote work in order to capitalize on the wave of people moving out of large cities.
When investing in a property, consider the needs of the remote worker and implement design elements into your property that addresses the needs of someone working from home. These changes can include creating dedicated spaces inside apartments for remote work setups, which can be achieved by converting existing closets or building out an alcove with space for a desk. Soundproofing can also be a massive bonus for renters working from home in apartment complexes, allowing for more privacy when taking calls or virtual meetings at home. Another option is converting common areas into soundproof call rooms that can be reserved ahead of time by tenants, although you’ll want to clearly convey the cleaning measures to your tenants. Including these benefits can help attract and retain renters who are working remotely, which is particularly important as the number of remote workers continues to rise in the U.S.
As with most shifts in the demands of renters, there is always give and take. Converting spaces and adding new amenities are expensive decisions, but these changes are what will determine your ability in the future to attract and retain renters. As the investor, it’s important to focus on projects that are tuned into what renters want now and what they’ll want 10 years from now to make sure these properties are attractive for many years to come.
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